There are numerous non-cash techniques employed today for executing payment by a purchaser to a merchant. Indeed, numerous types of credit cards and banking cards are in widespread use. For example, the ubiquitous credit card can be used to pay a merchant, with the transaction being paid for by a credit card clearing house or bank and creating a credit obligation for the owner of the credit card. Another type of card which looks like a credit card but functions differently is the so-called debit card. The debit card is used much like a credit card in that it is tendered by the purchaser to a merchant for payment. Payment is effected from a bank to the merchant and the funds are deducted directly from the card holder's bank account.
As an alternative to cash, many banks are now offering so-called "cash cards". Cash cards require the purchase of a card which looks much like a credit card, but which has a limited amount of available value to be spent (the balance is contained in a computer chip in the card). As the cash card is used, the remaining balance on the card is depleted.
As an alternative to the use of credit cards or checks, many people still rely on the use of cash, but often need access to funds in a bank account after traditional banking hours. Automated teller machines (ATM) have allowed people to access funds on weekends and at night.
Each of these payment methods has certain drawbacks. For example, the use of ATM cards and ATM machines provide a substantial safety risk to the user inasmuch as people are often vulnerable to being robbed at ATM machines. Also, ATM cards do not provide any budgetary limits and do not report the actual usage of the funds (ATM cards do not show how the funds were spent, only showing how much funds were withdrawn from the bank account). Credit cards create debt obligations rather than drawing against actual funds contained in a bank account, thereby teaching poor budgetary habits. Furthermore, credit cards are not generally useful for use by minors inasmuch as minors are generally incapable of entering into a binding contract. This can make merchants reluctant to accept credit cards as tendered payment by creation of a credit obligation. However, debit cards do not contain a budgetary limit. Cash cards have the disadvantage of requiring that they be paid for in advance and are no more secure than cash.
Accordingly, it can be seen that a need yet remains for a payment method which allows budgetary limits to be imposed on spending, which prevents someone other than the account owner from emptying the bank account, and which provides good tracking of how the funds have been spent. It is to the provision of such a payment method that the present invention is primarily directed.